2019 (8) TMI 1255 - AT - Customs

Reduction redemption fine penalty - HELD THAT - The enhancement of value has been ordered by the First Appellate Authority on the basis of concurrence given by the importer for such enhancement. There is no challenge to the order of confiscation, but Revenue is challenging the quantum of redemption fine and penalty, which stand reduced by the Ld. Commissioner (Appeals). The Ld. Commissioner (Appeals) has ordered reduction of redemption fine and personal penalty on the basis of ratio laid down by the Three Member Bench of CESTAT, Delhi in the case of Omex International Vs. Commissioner of Customs, 2015 (4) TMI 112 - CESTAT NEW DELHI (LB) . The Three Member Bench has taken the view that redemption fine of 10% and penalty of 5% of the value of the imported goods, would be appropriate in case of import violating Exim Policy Provisions. - no reason to interfere with the findings of the Ld. Commissioner (Appeals) Appeal dismissed - decided against Revenue.

Summary

Issues:
Delay in filing appeal before the Tribunal, enhancement of value of imported goods, confiscation of goods, reduction of redemption fine and personal penalty, challenge to the order of the Ld. Commissioner (Appeals), justification for increasing redemption fine and personal penalty, applicability of precedent on redemption fine and penalty.

Delay in filing appeal before the Tribunal:
The Appellant filed a Miscellaneous Application to condone the delay of 97 days in filing the appeal before the Tribunal. The delay was condoned based on the reasons explained in the application, and the Miscellaneous Application was allowed.

Enhancement of value of imported goods and confiscation:
The respondent imported used and worn unmutilated and fumigated mix cloth, with the declared value being enhanced from US$ 1.10 per kg to US$ 1.316 per kg during the original assessment. The original adjudicating authority confiscated the goods under Section 111(d) of the Customs Act, 1962, for violating Import Trade Control restrictions. Additionally, a redemption fine of 30% and a personal penalty of approximately 11% were imposed.

Reduction of redemption fine and personal penalty:
The First Appellate Authority upheld the order of confiscation and value enhancement but reduced the redemption fine and penalty to 10% and 5% respectively. The Revenue challenged this reduction, arguing for an increase in the redemption fine and personal penalty to deter frequent importers violating regulations.

Challenge to the order of the Ld. Commissioner (Appeals):
The Revenue challenged the order of the Ld. Commissioner (Appeals) seeking a review of the reduction in redemption fine and personal penalty. The basis of the challenge was the need for a higher penalty to discourage violations by repeat offenders.

Applicability of precedent on redemption fine and penalty:
The Ld. Commissioner (Appeals) reduced the redemption fine and personal penalty based on a precedent set by a Three Member Bench of CESTAT, Delhi, in the case of Omex International Vs. Commissioner of Customs, New Delhi. The precedent established that a redemption fine of 10% and a penalty of 5% of the value of imported goods were appropriate for import violations. The Tribunal found no reason to interfere with this decision and upheld the impugned order, rejecting the appeal filed by the Revenue.

This detailed analysis of the judgment covers the issues of delay in filing the appeal, the confiscation and enhancement of value of imported goods, the reduction of redemption fine and personal penalty, the challenge to the Ld. Commissioner (Appeals) order, the justification for increasing penalties, and the application of precedent on redemption fine and penalty.